Pillar 3a life insurance
You can also take out life insurance in conjunction with pillar 3a. Here’s what to watch out for.
Adi Kolecic
18.01.2023
iStock / supersizer
Some life insurance products are based on the restricted (pillar 3a) pension plan. These products offer tax benefits. Compared with pillar 3a savings accounts, pillar 3a life insurance policies are subject to additional restrictions with respect to beneficiaries.
Points to note
You are tied to the same insurance company for the long term.
You pay fixed annual premiums for the entire policy term.
There are severe financial penalties for terminating your policy before maturity, especially in the early years. Check the surrender value carefully.
Management fees for unit-linked life insurance mean lower returns.